Supreme Court Rejects Wal-Mart Class Action Lawsuit

In a controversial decision in mid-June, the Supreme Court rejected class action status for 1.6 million women who sought to sue mega-store Wal-Mart for employment discrimination in what would have been history’s largest class action lawsuit. More than a year earlier, the 9th Circuit Court of Appeals approved the lawsuits, arguing that the #1 company on Fortune’s list of 500 largest companies must address claims that women are paid less than men for the same jobs and are less likely to receive promotions. But by a 5-4 vote, the Supreme Court said it was a stretch to decide the fate of 1.6 million discrimination lawsuits at once, a major set back for Wal-Mart discrimination plaintiffs.

This all began back in 2000, when Betty Dukes, a “store greeter” at a California Wal-Mart said she was refused the chance for a promotion despite six years of glowing performance reviews because she was a woman. In her complaint, Dukes reported that despite making up 80 percent of Wal-Mart’s low-pay jobs, women hold less than 15 percent of the company’s management positions. But Dukes’ case, when combined with 1.6 million other sexual discrimination lawsuits, was struck down by the country’s highest court, which said the class action included too many women in a diverse array of positions and salary levels to fall under one class action lawsuit.

The Court’s ruling has ignited concerns that the plaintiffs’ attorneys may have cast too wide a net in attempting to combine 1.6 million discrimination complaints into one lawsuit. This view was represented in the Court’s majority opinion, which chided the plaintiffs for trying “to sue literally millions of employment decisions at once.” For the majority, Justice Antonin Scalia wrote that “without some glue holding the alleged reasons for all those decisions together, it will be impossible to say that examination of all the class members’ claims for relief will produce a common answer to the crucial question why was I disfavored.”

The court’s minority dissent, penned by Justice Ruth Bader-Ginsburg, said the majority opinion “disqualifies the class at the starting gate,” and puts too much burden on the plaintiffs to prove that their individual claims are similar enough for class action status. Senate Judiciary Committee Chairman Sen. Patrick Leahy said the ruling marked a major setback for employees at major corporations nationwide. In a statement following the ruling, Leahy said the Supreme Court “decision will undoubtedly make some wonder whether the Supreme Court had now decided that some corporations are too big to be held accountable.

The major impact of this decision is likely that it makes it more difficult for groups of employees to sue for workplace discrimination against a major corporation. “Only workers who have a truly common legal claim may sue as a group,” wrote Lyle Denniston of SCOTUSblog, “and, even that claim will require rigorous proof that every single worker suffered from the same sort of bias.” That’s a tough hurdle for large class action lawsuits, and means future plaintiffs will likely seek to limit their numbers before taking on major corporations like Wal-Mart.